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tv   The Dylan Ratigan Show  MSNBC  December 6, 2011 4:00pm-5:00pm EST

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this is a closet that has recently occupied illustrious names like larry flynt, for instance. >> i think he's closer to you no terms of character. >> i want you to respect the closet. i feel like you don't take it seriously. >> i take it seriously. enjoy your bunker. enjoy your closet. >> all right. the show starts right now. a beautiful and lovely tuesday afternoon to you. i am dylan ratigan. nice to see you. live from this prestigious closet here on the third floor of nbc's studios in burbank, california. our big story today, cut it out. we're talking about the political pro wrestling on capitol hill. we're up against another possible government shutdown, not to mention unemployment benefits being cut and the separation of major tax cuts that could end up costing you
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and i $1,000 a pop if congress keeps dragging its feet. president obama today trying to invoke teddy roosevelt as he supervises the largest bank and health care insurance companies in history. >> this isn't about class warfare. this is about the nation's welfare. in the final years of his life, roosevelt took that same message all across this country, believing that no matter where he went, no matter who he was talking, everybody would benefit from a country in which everyone gets a fair chance. >> right in line with the pro wrestling screenplay, republicans spent the day slamming the democrats' so-called compromise attempts on the payroll tax extension. >> this was nothing more than another bill designed to fail, so democrats can have another week of fun and games on the senate floor while tens of millions of working americans go another week wondering whether they're going to the see a
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smaller paycheck at the end of the year. >> all right. luke russert's here to educate me once again, as to what the heck is actually going on here. luke, when it comes to the power dynamic between these two parties, as we approach the end of the year, what is actually -- what is presidential election year posturing, i presume all of it, and what percentage of it can actually be resolved and what percentage of it is never going to happen? >> what you're seeing this week, dylan, is what you mentioned, which is decision 2012, presidential year political posturing. the democrats are going to bring a vote on the senate floor about this new compromise deal that harry reid has showcased. it would make the payroll tax cut holiday less expensive, it would bring it down from about $240 billion down in the hundred billions. but that is not supported by the gop, because part of the pay for it is still a surtax on millionaires. the gop has said before to me that, well, that's going in the right direction. any kind of surtax on millionaires is a know-go in the
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house, sense it will not garner a lot of republican support in the senate. the only time it's been supported in the senate is by susan collins of maine. therefore you'll see democrats go forward with this plan. therefore the attempt will be able to say in december of 2012 that republicans voted against a tax cut for the middle class in favor of protecting their friends who are wealthy. later we expect to see a payroll tax cut by the gop, continuing the freeze of federal salaries where they are right now until 2015, as well as restructuring federal workers' benefits and pension plans. that is going to be voted through the house. it will most likely pass. but that has no chance of going anywhere in the senate. that allows republicans to also have the ad saying, look, we supported a may recall tax holiday by cutting spending. what's going to happen, dylan? you're going to have 11th hour agreement between john boehner and harry reid and most likely president obama where the payroll tax cut extension will be coupled with other things that need to be to get done before the end of the year,
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which are unemployment benefits, as well as a fix as to how medicare doctors are reimbursed, so they don't lose 23% of their salaries, so the government pace them for carrying out physician benefits. right now we're still on the posturing side. next week proves to be a very intense week. but it could go all the way to december 23rd and right into christmas, dylan. >> if you were to look at the context of what we've been through in the recent past, how does this compare to the super committee dysfunction? how does this compare to last summer? >> it's all very similar. the one difference between, i would say, the debt limit, which would have terrible ramifications for the economy, which almost everybody agreed on, there is still some argument between republicans and democrats as to letting payroll tax holiday expire, how bad that would be for the economy. john boehner said last week, he wasn't an economist, he wouldn't know how bad it would be. in the grand scheme of things, dylan, i would say this is going
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to be contentious, mainly because it's more politically radio active than anything we've seen so far this year, in a sense if you want to raise taxes on working americans in an election year, that looks really bad. neither side wants to be guilty of that. >> thank you for the reporting, luke. i want to turn to a man who has successfully navigated so much of washington's pro wrestling, ed rendell, a former pennsylvania governor. a heck of a fund-raiser in his day. leader of the democratic party. a man who agrees with us that the money in politics has really corrupted the ability of the system to function. i feel like i'm watching the board of directors from a publicly traded company that's a much more valuable company than any company i ever covered at cnbc, and the board refuses to even talk to each other. they won't even make an agreement to anything. it's pretty sad. >> it's absolutely brutal. and, look, do we need to compromise on all of the issues that luke talked about?
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yeah, we do, but i want to focus on something which i think is the height of hypocrisy. when republicans are asked why they don't raise taxes on the top 2%, they always come up with a line, because it would harm the job creators, it would stop us from creating jobs. because there are many small businesses, sn, dylan, who file individual tax reforms. well, the democrats in their compromise proposal took care of that. they exempted businesses that file under sub-chapter "s." so they don't even that that argument to full back on. and that argument makes no sense. when george bush cut taxes, the economy tanked and we had the four or five worst years of job creation in the last 30. when bill clinton raised taxes on the top 2%, we produced 23. 5 trillion jobs. we've taken that argument away from them. the only people who will pay the
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surcharge are individuals who make more than $1 million. and good lord, they can contribute to making this a fair country. so it's the height of hypocrisy. it's typical, you know, republican stance. and i am also calling on my good friend, grover norquist to speak up. and grover norquist should be loud and clear that this tax cut should be kept in place. because if republicans vote against it, then, in fact, they're voting to raise taxes. grover norquist should be as vigilant about this tax increase, as he is about a tax increase on millionaires. >> at the same time, and you know, i've talked to a lot of people, in general, about what we talk about on this show and the 94% and how do decisions get made in washington, relative to the obligations of fund-raising. and it is difficult to look at this, which is, really, this is an argument over scraps. we need 30 million jobs. >> absolutely.
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>> we need global debt restructuring. we need massive trade reform. we need massive review of the costs in our health care system. we are not even talking about those things. these are pieces of popcorn that fell out of the bucket that we're arguing about. and if we can't resolve who gets to pick up a piece of popcorn off the floor, how are we going to be able to deal with these large issues? and it is possible to do that or is it futile and do we need to turn our attention to the great 28 amendment debate with money? >> no. i really think that your overriding idea is important. let me give you a quick statistic. back in 1981, we were $680 billion a year in corporate tax breaks, in the tax code. those were all the result of effective lobbying. this past year, it was $1.2 trillion. you know, almost double. $1.2 trillion of corporate tax breaks in the tax code. if we got rid of them, if we got rid of them, even if we lowered
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the rate from the 35%, which no one pays, to 25%, we would generate about $1 trillion in income, in new revenue a year. over a ten-year period, that's $10 trillion. that almost takes care of the entire projected federal deficit. and why aren't we doing it? because there are lobbyists to defend each and every one of those tax loopholes. each and over one of them has a strong lobby organization behind it. the only way we're going to stop the power and influence of special interests that is really screwing up the finances of this country, the environment of this country, everything else, is to have a 28th amendment that says, yes, you can limit campaign expenditures. you can have real campaign reform, real limits on what special interests contribute to politics. and it has to come. >> and the exciting thing, from my perspective, going to the conversation that really began with you last summer, and going beyond the quarter million
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sergeants that are on the petition at this point and that continues to grow and i'm certain that it will grow significantly over the next year, but in addition to that, we're seeing money coming together, we're coming an apparatus come together. but there are two amendments, one, the voting age to 18. ten months, piece of cake. it was an american issue, breach of fairness. and there was the era, that was seen as a whack-a-doodle lefty amendment and never got anywhere. even though both really aspired to the same fairness principle. and it seems this same crusade could go the way of the 18 rapid fairness resolution, or could be marginalized as a faction of one or the other political party. >> well, i agree, but i think we should absolutely continue on that effort. one of my messages to the occupiers here in pennsylvania, but all across the country is, you think there's too much income inequality in america? of course there is, you're right. do something. let's get signatures for this 28th amendment effort, and let's get it going. and let's put tremendous
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pressure on state legislatures to do the right thing here. we can do this we can accomplish a much fairer system. and it wouldn't mean that businesses would be unrepresented. it would just mean that they wouldn't have undue influence. they would be at the table like everybody else, but they wouldn't be able to buy their way into tax loopholes, tax credits, you name it. >> and your advocacy is invaluable and your continued support, i think, is greatly appreciated. i know it was greatly appreciated, not just by me, but by really hundreds of thousands of millions of other folks who wanted to do this. >> thanks, dylan. remember, i told you, though, that i was, as you said, a pretty prediggous fund-raiser. and when i came out in favor of him, it was like, having ali baba speak out against fever. >> you're talking to the man who brought eliot spitzer back into the conversation, because i think he's brilliant on the banks. the point of my book is that
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everybody's a greedy bastard. it's really a matter of whether, in fact, you're able to change the system that you work inside. so i think it's important that people like you are involved in this to model both your own awakening, your own awareness, and your own willingness. >> thanks very much. >> ed rendell, we'll talk to you soon. ed. coming up here on "the d.r. show," president obama tries channeling teddy. we'll talk about the real teddy roosevelt and what he would do with giant bank and health insurance monopolies. plus, occupy clashes, afghan car bombings, and yet our specialist says we may be living in the least violent period in history. and he parachuted from a plane, disappeared into a night, had 200 gs on him when he was done. now after four decades, police may be finally closing the book on old d.b. cooper. details, straight ahead. p so much shrimp cocktail. where do you think it all comes from?
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well, today the occupy movement took another step, moving from cities, colleges, and wall street to the actual courthouse, the kangaroo court, if you will, corrupting our nation. we refer to it as capitol hill. occupy congress descended on the bull's-eye of washington today. a beautiful thing in my view. members from a broad range of organizations marched to the capital and then spread out to meet with their representatives, air their grievances, and as they say, take back the people's house. and what better way than the 99% to take a stand against the growing wealth gap than confronting our crushingly
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ineffective and misaligned congress, which has not only worked to preserve and strengthen the finances of the richest americans, but is half full of millionaires itself, not the sort of millionaires that actually made something that's useful to you, either. this comes on the heels of a standoff at washington's mcpherson park, where 31 occupiers were arrested, with some occupiers forcibly removed. i want to bring in our monday megapanel, susan del percio, karen finney, and jimmy williams. your thoughts on the kangaroo court arriving? >> there's a part about d.c., and when you talk about extraction, what goes on in the capitol behind me, in terms of the money between "k" street and the capitol and the money that is extracted from the district of columbia and the lack of services and budget that we have here in d.c. is obscene. part of this movement was also to say, you can't just put all that money in there and not be responsible for what goes on in
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this city, with the kids in this city creating jobs in this city. >> is it the right metaphor, jimmy, to look at washington as the courthouse? it's as if the occupation in new york, they're at the guillotine and protesti ining the executio. but the fact of the matter is, you have to go to the courthouse if you want to alter the ways that the rules are being made. and that courthouse in this country is washington, d.c.. >> you know how when you go to the bank and go to the drive-in teller and go up and put your check in the little thing and it goes into the tube, right? and it goes into the bank? and they send it back to you through the tube. what you're talking about is new york, wall street, right? corporate america. and they take the money and funnel it in a tube, and it goes into "k" street, and "k" street takes that money and funnels it straight into the capitol build, but outside, of course, because you can't take money inside. so what's the difference? it's the same exact thing. and susan, we've talked
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about the sort of counterproductive nature of some of the aspects of the actual protests themselves, disrupting people who really are not the offending party. you know, local businesses, local employees, local residents and this sort of thing. you have to be encouraged to see at the very least the energy focusing -- you'd rather see a drum circle on "k" street than in zuccotti park, i'd expect? >> i think it's fantastic that they've finally taken their message to the people who can make changes, and hopefully some of those people will run for office so they can be part of changing the process. i know right now you're calling ate courthouse and i think most of those protesters probably think of it more like a doghouse, but -- >> i'm sure
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and what did it get us? insurance companies that jacked up people's premiums with impunity and denied care to patients who are sick. mortgage lenders that tricked families into buying homes that they couldn't afford. a financial sector where irresponsibility and lack of basic oversight nearly destroyed our entire economy. >> and, again, it's welcome
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rhetoric from somebody with my perspective, karen, but it confuses me, because he speaks in this past-tense framing that suggests that he wasn't the president when dodd/frank was passed, which codified the largest two too big to fail institutions in the history of the world. or that he wasn't the president when he supervised the backroom monopoly deal with the drug companies for drug pricing, or the karen ferguson exemption for the health insurance exemption. and i solely recognize he was not the unique authority for all of those problems and it's not fair to lay all of that at his feet. but it strikes me as an interesting posture to be laying that rhetoric while being in the white house while supervising these kind of health insurance monopolies. >> sure. but the other part of the frame in the political goal here is to also try to get this out of the realm of, this is class warfare, and try to remind people that there was a bigger idea on which this country was founded. and that we're talking about a fundamental sense of fairness, and that that's the lens through
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which we should view a lot of these things, rather than what wave been seeing. that being said, look, i think we would have all liked to have seen him, you know, govern like teddy roosevelt from day one, when he had a 72% approval rating. that being said, and this is what the president's trying to arti articulate now, there is a frustration with republicans in congress who really have stood in the way of getting things done. if you don't like the way wall street reform was done, let's take a look at who it is right now that are protecting those interests when we're trying very hard to get this unemployment insurance extended, to get the payroll tax done. it's not the democrats. the democrats have come several times with ideas and modifications, and yet, you had the republicans -- so i think there's a point at which you have to say, the guy tried to get done as much as he could, and i think he's going to take a posture which says, i'm going to keep pushing and i'm going to call it out.
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i hope that's what we see. >> the only reason, karen, and susan, jump in here as well. i take issue with what you said, karen, because of this. eric holder was appointed by this president to run the justice department. tim geithner was a -- and i don't mean to put this for you, karen, to defend this president or this white house. i don't mean to cast it like that. but this president gave us eric holder, this president gave us tim geithner. eric holder has not found a single prosecution against a single banker under any circumstances since this entire fees cobegan amid a myriad of evidence that eric holder could prosecute on a multitude of levels. tim geithner, the same thing. when it comes to the fundamental restructuring of the banking system, and i just -- there's a desire, it feels, susan, to believe that if only the republicans weren't there, that this wouldn't have happened. but that denies the fact that there are all these authorities, especially in the justice department with eric holder, that could be exercised, and that have been exercised by past presidents, like teddy roosevelt
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and his justice department, which explicitly pursued standard oil. >> well, what's interesting is that the president actually did have two years of complete democratic control. he had the house, he had the senate. so two out of his three years, he governed without any republican input. >> susan, that's not all together true. you did have republicans in the senate -- >> but they controlled the house. let's face it, the only reason you have obama care and dodd/frank is because the democrats supported it and they wanted to get it through. it didn't get stopped by the republicans. they were able to get it through. what's interesting is that the president chose to, you know, have this speech and make another great political speech, but people are not listening to it. and that's -- >> well, i disagree with that. i disagree. >> and it's interesting that he used this location and tried to get his own teddy roosevelt out, because teddy roosevelt, when he gave this speech, it was intended as a political speech that was supposed to bring both sides of the republican party together and create the republican platform, in which -- >> well, it certainly shows how
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far the republican party has gone from where it was back in those days. >> well, he was a former republican. he was a specific thing, which was reforming republican. let's take a break. again, teddy roosevelt or barack obama, forget who the president is, gigantic monopoly, sucking your country dry are bad. ending them may be good. coming up, could the great john lennon have gotten his wish and we didn't even know it. the megapanel stays and the surprising claim by our specialist that right now might be the most peaceful time in world history. [ woman ] my boyfriend and i were going on vacation,
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a pakistan-based military group claiming responsibility for two out of three deadly suicide bombings in afghanistan today. 60 people killed in total in these attacks. that is the largest of the
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coordinated attacks to hit the country's capital city of kabul, where a crowd of shiite muslims gathered to park an important religious holiday. yet, in spite of all of these all too familiar images of violence and terror, our next guest argues we are actually living in an era of new peace that includes a decline in war, a decline in crime, and a decline in inequality. so the we actually have it better than our parents and grandparents? do we live in a safer society than perhaps any human generation before us? our specialist, steven pinker, " author of "the better angels of our nature." talk about why our view of the world may lead us to perceive it as a more dangerous place than it may actually be.
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>> you might get an impression that violence is as prevalent as ever. but that shows that rates of violence have not gone down to zero. but to understand rates of violence, you also have to consider all the parts of the globe where war isn't taking place, and you don't have reporters in those parts of the world. there isn't a guy in angola saying, another war has gone by and there hasn't been a war here, or nicaragua or mozambique. only when you calculate rates of violence as a proportion of the world's population do you know whether violence has gone up, gone down, or stayed the same. what the numbers show is -- >> is that the foundation of -- is that your data set that you're asserting in this book? is that the proportion of violence is at a record low? >> yes. well, one of the chapters is on war across the world. there are other chapters on crime, on tribal warfare, on cruel practices, like burning heretics at the stake or
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executing 7-year-old girls for shoplifting, slavery, blood feuds, dueling debtors' prisons, and another one on the decline of old-fashioned wars between two armies from two nations, which have almost disappeared off the face of the earth. the remaining wars are almost all civil wars. so violence has gone down on a lot of scales. everything from world wars down to the treatment of animals and children. people spank their children less. there are fewer -- the practice of lynching has been eliminated in the united states. it used to take place at the rate of 150 lynchings per year. the imprisonment of homosexuals has been eliminated in much of the world. so at many, many scales, violence seems to be in decline, if you take a historical perspective. jimmy? >> dylan, i'm actually pumped, when i finished reading chris matthew's book on jfk, i have a
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book that i actually want to read, professor pinkerton's book, which sounds fascinating to me. if you took today's cameras and you had war correspondents back during the civil war, in the fields of gettysburg and manassas, during the revolutionary war, i think perhaps that would prove your point. but here's my question. is that that we have less violence, or we just know more about it and we have smarter war today? computers run our wars today, not actual human beings? so what's the give there, i guess? >> well, of course, the fact that we have cameras and helicopters and jet planes and electronic media means we're better able to report the violence that does occur. so if anything, the advancement of technology should make us better able at detecting violence. and i think that's behind the misimpression that violence has increased. namely, wherever it occurs, it can be broadcast over the world instantaneously. but what it means is there may have been even more violence in the past than we're aware of.
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it may have been like a tree falling in the forest with no one to hear it. >> right. susan? >> just a follow up on that, professor. isn't it also possible, because now we're so much more connected and everyone sees the behavior of other people, that we've kind of gotten shamed out of doing certain things. because the country, as you mentioned earlier, are remote technologies. they don't have a lot of technology. they're not seeing the tv, they don't have internet connections. there's no way of monitoring them, and therefore, shaming them into better behavior. is it part of what we've done over the years? >> very much. i think that the human reality of war, the pure horror of what war can do to a population, especially a civilian population, is something we're more aware of thanks to mass media. those pictures coming out of vietnam, of that naked girl running terrified from a napalm attack shocked people. and 100 years ago, you could hear people saying that war is glorious and honorable and manly
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and spiritual and holy. you can't make those claims if you have a mental image of that little girl in your mind, and i think that's one of the things that the mass media do that have helped bring violence down. >> we were just flashing these numbers. it showeded in prehistoric times, there was a 15% chance you would be killed by another human being. that is a time i'm happy not to be living in at this moment. karen, your question? >> just a quick question here. did you look at sort of the shifts. it seems to me that parts of the world where you were talking about where there were wars or violence to some degree have shifted. here in the united states, it seems like violence has shifted, certainly in the inner cities, it's still pretty high, whereas maybe in the suburbs, not as much as. and also what we would consider violence. i mean, bullying and online violence is a form of violence we didn't used to track, but i think it counts in terms of the fear factor it can really create for people and terror.
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>> that's right. one of the signs of decreasing violence is that we're more and more sensitive to categories of behavior that wouldn't have even been considered violence in the past. 25 years ago, bullying wouldn't have counted as violence. it would have been called childhood. boys will be boys. now we care about it. and more and more, there are types of behavior that used to be considered just the way things were done that are no longer considered acceptable. certainly violence -- that the profile of violence has shifted. i don't think it's just been displaced, like squeezing one end of a balloon, and the balloon will bulge out at the other end. in the middle ages, it used to be rich people and poor people who committed violence. aristocrats would be surrounded by an armed retinue, who would engage in street brawls when they encountered another armed retinue of a rival aristocrat. now we think of violence of something that poor people and poor countries do. but it used to be that rich
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people and rich countries would be at each other's throats. >> although they kind of live that way in beverly hills. you can't park your car over there! anyway, professor, it's an absolute pleasure. thank you for forcing us to see reality as opposed to fantasy, especially when it's a reality that's remarkably encouraging and puts us in that long cycle trajectory that is ultimately a positive one. thanks to the megapanel. thank you, professor, and even thanks to beverly. that's beautiful. still ahead, is it finally case closed on the only unsolved airplane hijacking in u.s. history. the woman who says that the db cooper case has been solved.
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well, after 40 years, it may
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finally be case closed on the mysterious disappearance of d.b. cooper. according to a woman who says her uncle is the infamous hijacker. the fbi is now ready the close the books on what has been the only unsolvered airplane hijacking in u.s. history. earlier this year, marla cooper approached the fbi, claiming her uncle, l.b. cooper, was the man who common deandeered a northwe flight and parachuted out of that bird with 200 gs in her become pac. she told agents that her uncle showed up injured in her parents' home in oregon the very next day and gave the fbi some of his personal items to prove that l.b. cooper is d.b. cooper. now marla says the lead agent told her he believes her and that uncle l.d. is d.b. they're working to match fingerprints on a toothbrush she gave them to prints found at the scene. >> regardless of the findings of
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the fingerprints, they would be closing the case after this. he said, he said, i am certain your uncle did it. i feel certain that your uncle did it. >> l.d. cooper passed away in 1999. meantime, the fbi admits that they're testing l.d.'s stuff, but they will not comment on the future of the case. so for those of you keeping track at home, if a crook in a nice suit jumps out of a plane with a parachute and a stolen $200,000, we, uncle sam, that is, america, will hunt you down for the next 40 years! but if a crook in a nice suit extracts trillions of dollars on an ongoing basis from the western economy that is the largest and most powerful in the world, ours, and then jumps out with a golden parachute, don't worry, you're pretty much in the clear. next up here, shining a light on the secret world of how
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they get all of that money and, basically, what we can do to fix it. swaps. yesterday we ripped a page from the "greedy bastard$!" glossary to explain what they are. today, what we can do about it. do you have an irregular heartbeat called atrial fibrillation, or afib, that's not caused by a heart valve problem? are you taking warfarin to reduce your risk of stroke caused by a clot? you should know about pradaxa. an important study showed that pradaxa 150mg reduced stroke risk 35% more than warfarin. and with pradaxa, there's no need for those regular blood tests. pradaxa is progress. pradaxa can cause serious, sometimes fatal, bleeding. don't take pradaxa if you have abnormal bleeding, and seek immediate medical care for unexpected signs of bleeding like unusual bruising. pradaxa may increase your bleeding risk if you're 75 or older, have kidney problems or a bleeding condition, like stomach ulcers.
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well, we're back and breaking down the dark, unregulated world of swaps. we started yesterday defining what a credit default swap is, and really, broadly, with bill fleckenstein, what a swap is. think of it like an unregulated insurance product, where you can bet on whether people, businesses, or even nations will default on future loan payments. our goal with these segments is to help prepare you for the release of our book," greedy bastard$!" next month. today we're talking about why the unregulated swaps market and its $700 trillion -- $700 trillion -- it dwarfs every other liability that we have -- is so dangerous and so devious. and more importantly, what we can do about it. you might find the answer remarkably simple. let's bring in henry blodgett, editor and chief of the business insider, and barry ritholtz with phusion iq. henry, i'll start with you. we've watched basically every
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financial security in the world posted to enexchange, traded publicly, it becomes a more transparent, it becomes a narrower spread, means it's cheaper and easier to transact in, and we have this one market, which happens to be the largest market on planet earth, that is traded in complete blackness with no capital required if you're a aaa financial institution. is there any possibility benefit to keeping that market in the blackness? >> not unless you work on wall street, which is a huge benefit, obviously, there. no, they obviously should be regulated, they should be disclosed, first and foremost, so we can actually assess how much risk is at stake. that's what killed us in the financial crisis. we had no idea what the collateral requirements were for, who had bet what, and so forth. you just can't know. so they obviously should be disclosed. >> why, barry, is having an exchange, or any any marketplace, so beneficial? >> well, a number of reasons.
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keep in mind that swaps and other derivatives are unique animals in the financial world. stocks, bonds, options, mutual funds, futures. everything else is required to be traded on an exchange, have reserve requirements, the exchanges make sure that the people who are actually trading these instruments have sufficient capital requirements, they're capable of meeting margin calls. they have the ability to stand behind the trades. when you have the exchange there, someone is guaranteeing that when the bill comes due, someone is able to make that payment. that doesn't take place with derivatives. and that is, by design of a legislative act that was passed in 2000. >> and why would they design it in that way? in other words, what benefit -- if we're a capitalist country that believes that we want to have this public marketplace, for any financial security, and really have capital required for consumers to buy things or for banks to lend things, and we want to deploy that capital in
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collaboration to create value, to solve problems, how does creating this secret market with no capital help us become what we claim to aspire to, henry? >> well, you kind of answered your own question there, exactly. it's a secret market. it's just easier. these are very complex instruments. they have all sorts of trigger points. the idea that you would have to disclose every single one of them if you're a massive global financial firm is frightening. and you also fear you're opening up your books so everyone can vet against you. you don't want to have that happen. but as we've seen, and we've had a big test case, the current situation just does not work. so you have to disclose what's going on. >> the fact of the matter is that we went from fractions to decimals in the stock market, barry. when the bloomberg terminals came back out going to the early 1980s, and what that did to bond market spreads. the profitability of a financial business simply ain't what it
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used to be. how much of a threat to the profitability of a jpmorgan or another western financial institution would crushing the margins a la the decimalization of the stock market be in the swaps market? how damaging would that be? >> well, there's two things you have to keep in mind to answer that question. first, there's a huge problem with the swaps market, as it exists today, because there are no real reserve requirements. the risk against counterparties is tremendous. hey, ask aig how it worked out to write $3 trillion in swaps with zero reserves. didn't work out too well for them. that's number one. number two, you know, banking and wall street used to be the servant of the rest of the economy. but wall street existed in order to help bring companies public, to provide financial services, and banking services to the rest of the productive economy. and what's happened over the past 20, 30 years is the tail has begun to wag the dog.
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financial services became an end unto itself. and so i don't have a problem going back to boring banking, when they did simple stuff, they borrowed at 3%, they lent at 6%, and they were out on the golf course at 3:00. >> very quickly, last question to both of you. what is the danger to all of us in our currency, in our productivity, in our employment, in our social stability of continuing to ignore this problem and not address it, hen henry? >> we're exactly where we were before. nothing has changed. as barry said, there are no reserve requirements. we have no idea what's on the books of banks. we're set up to do exactly the same thing again. i think that's why you saw the entire reserve of world banks freak out and say, oh, my goodness, what's going on in europe, we've got to step in. >> the only thing i would disagree with henry about, the only thing that's changed is that bankers know, hey, if we really screw up badly, the government is there to backstop us, so let's take as much as
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risk as we want. it's worse than it was in '08. >> i think henry gave you a t tuche on that one. check out both of these gentleman's work, henry at the business insider or barry at the fusion iq. we've posted a blog called leverage: the dynamite strapped to our markets. check it out at or "the huffington post." that leverage created through this dark swaps market. coming up on "hardball," front-runner newt gingrich now sprinting ahead in the polls. but chris asks, can the man go the distance? but, first, the daily rant. david goodfriend with a message for occupy d.c. and they're protesters. bring it on!
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now david goodfriend in d.c. with a rant about those d.c. occupiers. hi, david. >> hey, dylan. you know, i'm troubled by the images of occupy protesters being forcibly removed from mcpherson square park here in washington, d.c. washington is our public square. it's where the nation comes together to voice our views, air our grievances, and most important, petition our government. throughout our history, the people have come to washington to express through peaceful protests their ideas and feelings. civil rights marches, the anti-abortion protests, the million man march, the tea party. whether you agree with them or not, these are signed posts on
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our national journey towards forming a more perfect union. but there have been troubling supposed too, when people have tried to express their views in washington, only to be met with force. and one of them stands out in my mind these days. it was the middle of the great depression. veterans of world war i who had been promised a cash bonus for their service were among the starving and unemployed masses. they came to washington and set up camp with their families in public places, demanding that the government pay their bonuses early. they came here by the tens of thousands. and when president hoover decided he had had enough, he sent soldiers mounted on horseback and backed by tanks to forcibly remove the veterans. those soldiers were let by none other than douglas mcarthur. shots were fired, veterans died. men, women, and children were driven from their camps. now, the protests ended, but the seeds of justice that were planted on that day eventually took root. it was part of a movement to establish a new baseline for personal economic dignity here in the united states. now, i realize that the occupy
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d.c. protesters are not exactly the same as those world war i veterans. well, for one thing, it was totally unnecessary and provocative for a few protesters to build a wooden structure in the park. but at a higher level, the occupy proteste erers and those world war i vets share something in common. unemployed workers, including many iraq and afghanistan veterans needing a job, college grads droung in student loans, retirees seeking security. they, too, feel as though they were promised something and have been betrayed. they, too, came to washington to petition their government to the seek redress for grievances. different times, different degrees, but similar images in our national public square. i work here in d.c., and i can tell you, the occupy protesters aren't hurting anyone. and to the extent that they warn washington of its failure to protect the middle class, create jobs, and keep wealthy interests in check, i say, let them occupy. dylan? >> what are you -- what is your
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opinion of the idea of really forcing the disruption out of all the cities of america that currently contain occupations and centralizing that disruption on the actual city, the kangaroo court, if you will, that continues to render the legislation that the folks in portland and san francisco and new york and out here in los angeles, and in kansas city, and st. louis and dallas feel the consequences of the bribery and chicanery that's practiced in d.c. >> look. i think it has to come to d.c. but dylan, i like the fact that it's around the country. i like the fact it started on wall street. i like the fact it's coast to coast. this is a real phenomenon, it's a movement, and it should be everywhere. >> and i don't -- again, that's not -- i don't dispute that, but to be effective, don't you have to intervene at the actual courthouse? >> yep, they're in the right place. >> yeah. a wonderful rant, as always, david. i'll talk to you sooner than later. >> thank you. >> that does it for us. i am dylan ratigan. and "har


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